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> unbridled speculation (or probably, Tether) One can thank decades of central bank malfeasance for this. I consider crypto in large part just a bit further ou

> unbridled speculation (or probably, Tether) One can thank decades of central bank malfeasance for this. I consider crypto in large part just a bit further out on/at simmilar place on the spectrum than DM/EM HY, neg nominal-yielding $ denom soverign/corporate bonds, and neg eps corps equity. I think those who are clutching their pearls over tether and ignoring the fact that many offshore banks with $ denom "deposits" (no fdic "backstop", that still wont protect against systemic risk onshore, and various amount of rules and regs on paper only [no enforcement powers, very little operations transparency into all the derivatives under then sun, most bilateral]) on their balance sheet are in a weaker position than them and are generally ignorant of the eurodollar system (esp wrt rampant rehypothication of collateral/cashflows denominated in currencies their local jurisdictions cannot mint at will). > it became clear that a huge chunk of yield was coming from earning tokens that had market value for no particularly clear reason. Yeah, i hate this about the defi lending (over/under/un -collateralized) space now and I purely focus on what of that yield is actually in stablecoins and ignore the part that isn't (I can always dump that part for stablecoins and put that back in). > I think this is insanely cool to observe, but also insanely stupid for people to put material capital (often capital they can't really afford to lose) into these experiments which are likely to fail. I agree, and the same is true in tradfi markets for most speculative actors and those where the cb/gov cannot "afford" to "backstop" everything up to junk bonds when passive global leveraged long-duration trade rolls over occasionally.

qeternity 5y ago
> I think those who are clutching their pearls over tether... No pearl clutching here. Best case, Tether is a MMF and is an absolute catastrophe by those standards. Medium case, Tether is a bank (or hedge fund) and is a catastrophe by those standards. Worst case, Tether is an outright fraud, and is damn impressive by those standards. But in all states of the universe, Tether is far far worse than whatever sort of off-shore cruft you think the typical bulge bracket is hiding.
- cinquemb 5y ago
  > But in all states of the universe, Tether is far far worse than whatever sort of off-shore cruft you think the typical bulge bracket is hiding. I've seen whats on some bank balance sheets that are non public on some SEA and NG banks for $ deposits after briefly working for a few fintech's and doing intergrations (and prob will never see the light of day [and most wont blink an eye because its not crypto to clutch pearls about, esp some failures _pre_ covid global lockdowns that could fall under any of your classifications for cases, that were mere footnotes in the public eye wrt financials unlike tether which is still operating I might add to the chagrin of many]) information unlike what we have _seen_ for tether in _public_, and this very much hyperbole… ssdd in eurodollar land… even as far back as 1975[0] from Richard Debs, FRBNY’s Chief Administrative Officer: "Finally, for the sake of logic, I should mention the legal framework of the Euro-dollar market, since I included the Euro-dollar market in my working definition of international banking from the point of view of the United States. However, I’m afraid that I can’t do much more than just mention it. The Euro-dollar market itself is not easily definable, and its legal framework, if any, is even less so. The market grew rapidly without the assistance, or burdens, of an integrated or even coordinated set of laws. It is an international—or multinational, or transnational—phenomenon, but it is regulated only to the extent that the Euro-dollar activities of the institutions operating in that market—the Euro-banks— are subject to regulation and supervision by the national jurisdictions in which they operate." [0] https://alhambrapartners.com/2021/09/17/dollar-warning-update-from-the-islands-which-started-it/ https://alhambrapartners.com/2021/09/17/dollar-warning-updat...

qeternity 5y ago

> I think those who are clutching their pearls over tether... No pearl clutching here. Best case, Tether is a MMF and is an absolute catastrophe by those standards. Medium case, Tether is a bank (or hedge fund) and is a catastrophe by those standards. Worst case, Tether is an outright fraud, and is damn impressive by those standards. But in all states of the universe, Tether is far far worse than whatever sort of off-shore cruft you think the typical bulge bracket is hiding.

cinquemb 5y ago
> But in all states of the universe, Tether is far far worse than whatever sort of off-shore cruft you think the typical bulge bracket is hiding. I've seen whats on some bank balance sheets that are non public on some SEA and NG banks for $ deposits after briefly working for a few fintech's and doing intergrations (and prob will never see the light of day [and most wont blink an eye because its not crypto to clutch pearls about, esp some failures _pre_ covid global lockdowns that could fall under any of your classifications for cases, that were mere footnotes in the public eye wrt financials unlike tether which is still operating I might add to the chagrin of many]) information unlike what we have _seen_ for tether in _public_, and this very much hyperbole… ssdd in eurodollar land… even as far back as 1975[0] from Richard Debs, FRBNY’s Chief Administrative Officer: "Finally, for the sake of logic, I should mention the legal framework of the Euro-dollar market, since I included the Euro-dollar market in my working definition of international banking from the point of view of the United States. However, I’m afraid that I can’t do much more than just mention it. The Euro-dollar market itself is not easily definable, and its legal framework, if any, is even less so. The market grew rapidly without the assistance, or burdens, of an integrated or even coordinated set of laws. It is an international—or multinational, or transnational—phenomenon, but it is regulated only to the extent that the Euro-dollar activities of the institutions operating in that market—the Euro-banks— are subject to regulation and supervision by the national jurisdictions in which they operate." [0] https://alhambrapartners.com/2021/09/17/dollar-warning-update-from-the-islands-which-started-it/ https://alhambrapartners.com/2021/09/17/dollar-warning-updat...